Shore Capital remains bullish on J Sainsbury (LON:SBRY), arguing that the blue-chip supermarket will be increasing productivity as it integrates its acquisition of Argos. The comments came after the FTSE 100 group updated investors on its performance yesterday, posting a rise in sales, while sounding a note of caution going forward.
Sainsbury’s share price added 2.21 percent to close at 253.90p, with investors digesting the company’s quarterly update yesterday. The shares outperformed the benchmark FTSE 100 index which ended the session 0.23 percent higher at 7,748.51 points. The group’s shares remain down by nearly two percent over the past year.
ShoreCap remains bullish on grocer
Shore Capital reiterated its ‘buy’ rating on Sainsbury’s yesterday, without specifying a price target on the shares. The move came after the blue-chip grocer reported a rise in sales and lifted its profit expectations, while cautioning that market conditions remained challenging.
“Following our last engagement with chief executive Mike Coupe and chief financial officer Kevin O’Bryne in November, we came away impressed and pleased with the grown up, balanced, and measured manner in which they approached the running of their business,” the broker’s analyst Clive Black commented, as quoted by Citywire. “The prize of us with respect to Sainsbury’s remains a focus upon better utilising its asset base, being more productive, harnessing the planned synergies from the Argos acquisition and so cash generation.
“With this further stepping stone in Argos integration, and sound group-wide trading, we are pleased to see the broad plan being on-track,” the analyst concluded.
Other analysts on Sainsbury’s
Deutsche Bank meanwhile reiterated its ‘hold’ rating on Sainsbury’s yesterday, without specifying a price target on the shares. According to MarketBeat, the blue-chip grocer currently has a consensus ‘hold’ rating and an average price target of 261.86p.